Share this story
Close X
Switch to Desktop Site

Managers at Honda's hub: casual but purposeful

''We don't want to have cogwheel-type people in our company.'' Ten years after Soichiro Honda retired from the presidency of the motorcycle and car company he founded, his successors uphold his philosophy even as they practice a less personal, more collegial style of management.

''Here, take a look at our board room,'' said Hideo Sugiura, chairman of Honda Motor Company. ''Do you notice that as soon as you step from the corporate reception room to the executive office area, the quality of the carpet changes? It's not so luxurious, not so thick.''

About these ads

He led the way past a large office where secretaries and other workers were busy typing, or copying, or poring over documents, into a long, bright, airy room, divided into three main areas. The central feature of each area was a large round table with comfortable chairs. Beyond these tables, facing the windows, was a row of desks, four or five per area.

The central area had four of these desks each about the size of a school desk. Only one of them was occupied. These quite plebeian desks were for the four managing directors who handle the day-to-day affairs of the company, Mr. Sugiura said. The three absent directors were probably out on the workshop floor , or in a laboratory, or somewhere in the field.

''You see, none of these desks are very comfortable. That encourages us not to spend too much time at them. When Mr. Honda was active, he was always either in the lab or on the shop floor. In the end we had to give him a special president's room, just to get him out of our hair. But the tradition he established of having his top executives always in the field has continued.''

To the left of the managing director's area, in the same big room, is the area for ordinary directors. To the right is that for the chairman, the president, and three vice-presidents. These five, plus the four managing directors, make up Honda's top management, responsible for all major decisions such as establishing a car factory in the United States, or embarking on a joint venture with BL (British Leyland) of the United Kingdom.

''Most of the real business of the company,'' Mr. Sugiura said, ''is conducted not at our desks but at these round tables you see in the center. Anytime one of us has something he wants to discuss, he will gather round this table with the two or three, or four or five, people he wants to talk to. At any hour during the day, you may see groups of us sitting here. It all seems very ad hoc, but each of us knows what the others are doing. And somehow the work gets done.''

The discussion may seem unstructured, yet it is never without a purpose, and every participant knows that in the end it will be the president who decides. Since Mr. Honda's retirement in 1973, the president has been Kiyoshi Kawashima.

''That's the way it was with the decision to cooperate with BL,'' Sugiura said. ''Some of us, for instance, were opposed to the venture right to the end. But at a certain point the president said, 'Let's go ahead,' and that is what we did. As soon as that decision was made, we then began to divide up the work between us - what each of us was supposed to do.''

About these ads

The decision to set up a manufacturing operation in the US - first for motorcycles, then for cars - was reached the same way, Sugiura said.

He said people sometimes ask why Honda decided to go the joint-venture route in Europe while going it alone in the US. The reason, he replied, is that Honda is a maker of small cars, and Europe is a continent of small carmakers. There is already overproduction of small cars in Europe, and an independent manufacturing operation by Honda would only exacerbate competition and possibly squeeze out local manufacturers. That is why Honda decided its only chance of success in Europe lay in a joint venture with BL. The first step was to license BL to produce the Honda Acclaim. This has proved a success, and now the next step will be for Honda and BL to cooperate in designing and producing a totally new car.

''We feel we made the right decision,'' Sugiura said. ''We are satisfied in every way with our relationship with BL.''

How about the US, where Honda has become the first and so far only Japanese carmaker to produce passenger cars? (Nissan has just begun making trucks in Smyrna, Tenn., and Toyota has agreed on a joint car venture with General Motors in Fremantle, Calif.)

''We went into America on our own,'' Sugiura replied, ''because in the '70s when we were thinking of doing so, none of the big American companies wanted to make small cars or had any expertise in this field. So we were opening up a new market. We did have proposals from some of the major American carmakers, but we were determined that whatever we did, we would not be subcontractors. Whatever we made had to be our own product.''

For Honda, the decision to set up a manufacturing operation in Marysville, Ohio, first for motorcycles, then for cars, was a big one. The motorcycle plant cost $35 million, the car plant $250 million. Would Honda's distinctive management style work in the US with American workers? Could the legendary quality of its Japan-made motorcycles and cars be equaled if not surpassed in the US?

The first Honda motorcycle rolled off the spanking-new Marysville assembly line in 1979, and the first Honda Accord car went into production last year. So far, Mr. Sugiura and his fellow executives are very pleased with the way the entire operation has gone.

Honda, like other major Japanese companies, makes a lifetime commitment to its employees. But it does not demand the same commitment from its workers. ''Work for yourself,'' Mr. Honda used to say. ''If all you have to do is to tighten a bolt, see if you can't find a way of making the work easier. That benefits you, and benefits the company.'' He did not want his workers to stay because of loyalty, but rather to stay only if they themselves felt they were getting something out of it.

Sugiura feeks that attitude was one that American workers could feel at home with. ''Our workers are not tools of production,'' he said. ''We never say, we want to hire welders, or lathe operators, or whatever. What we are hiring are workers qualified to build motorcycles, workers qualified to build cars. The work force in Marysville that is now building cars grew naturally out of the work force we hired to build motorcycles.

''If you hire a welder, and then find a robot to replace him, there is nothing you can do with that welder. But if you hire someone and then train him in all the skills required to produce a motorcycle or a car, a robot to him will be just another machine to make his work easier.''

Sugiura said the basic trust between the worker and the management rests on the premise that management is dedicated to the long-term prosperity of the company, including the workers. That, he conceded, might be a difference between Japanese companies including Honda and American or European companies. American presidents had a board representing the shareholders looking over their shoulder all the time. Japanese shareholders were mostly institutional and gave their management the freedom to run the company in the best interests of the company itself.

''After all, a company is people,'' Sugiura said. ''No thinking person wants to be a cogwheel, and if any one does want to be one, we don't want him in our company.''

Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.